Going offshore to escape the CFTC

[Shatners_Last_Stand]

Hey Clint,
I have one broker to recommend for the list, ForexCent (Trade Forex from 1 cent - ForexCENT.com!), owned by Sarantal Investments, LTD, in the Czech Republic. Been using them for a few months now with no problems.

As the name implies, they offer the MT4 cent accounts – good for newbies.

Product offering is limited though – pretty much just the majors, gold and silver. The spreads are of the 4 decimal variety. Major dollar spreads are 2 pips even. So not for scalping. On the other hand, their overnight swap rates seem smaller than usual. For example, comparing with the Profiforex cent accounts, the swap rates for AUD/USD are:

Profiforex: long 6.95 short -9.76
ForexCent: long .60 short -1.81

They have a full featured website with live chat and webtrader. I used the chat to update some personal information after I sent them my ID documents. Funding was easy. Withdrawals have been instantaneous using Liberty Reserve.

[Clint]

I have one broker to recommend for the list, ForexCent…in the Czech Republic. Been using them for a few months now with no problems.

Thanks, SLS

I trust your judgment. I’ll add this broker to the List at the next update (today or tomorrow). Edit — updates are done.

It’s good to have an [I]addition[/I] to the List!

There must be other new brokers out there who want to do some business in the U.S. :42: — we need to find them.

[compounder]

Yes, I also have had a ForexCent account for several months now. Seems like a good broker, especially for people who have trouble making money with currencies and want to try day trading stocks. ForexCent offers about 32 individual stocks to trade with most requiring only about $5 margin in their “real” accounts, as opposed to their micro or “cent” accounts which do not offer stock trading. For each penny rise or fall in a stock price there is a corresponding penny move in your profit or loss on their trading station. Funding for me was challenging, though. I just gave up trying to do it cheaply and fast, so I used a bank wire with OkPay. I also sent a paper check by postal mail using OkPay but it takes at least a month for the money to get into the account, and they charge 10 bucks for the check. If a currency pair (not with stocks, I think) starts making a good, fast profit and you try to close your position quickly, sometimes they will very irritatingly ask you if you want to close, giving a requote if you hesitate too long. But after one or two requotes, or sooner, they will then usually quickly let you close, unlike FxGlory which will sometimes ask you 4 or 5 times if you want to close with a fast moving pair.

When a stock first spikes up 20 cents or more in 5 minutes on the 5 minute chart at the morning opening 8:30 AM CST from its yesterday close or its last price, it usually keeps going up at least another 15 to 20 cents, so I like to buy after that first spike and grab a quick 10 cent or more profit.

I am not aware of any US broker who provides individual stock trading like ForexCent does with only $10 needed to open a “real” account, so this broker deserves high praise in that department.

[Clint]

Yes, I also have had a ForexCent account for several months now. Seems like a good broker

Thanks for the input, compounder. I will add a reference to your post (#1974) in the listing for ForexCent.

[pipcompounder]

Firstly, allow me to thank Clint and contributors to this thread. I have followed for a long time and the information here is valuable and the thread remains on topic.

My question is: Of those traders on this thread that use FinFx and/or FXChoice, what has been your experience on execution, deposits and withdrawals involving larger account balances (US$25,000 and higher); particularly large ($US5,000 and higher) withdrawals of profits. Thanks in advance for any feedback, and thanks again for the thread.

I use Finfx, and havn’t tried withdrawing anything yet, but their execution is excellent, deposits can be instantaneous after the first one, if you using moneybookers\credit card. I would like to know people’s experience with them who have large accounts, too.

[petg6]

Hello, petg6

Thanks for the information which you have gathered.

Here’s what I’ve been able to determine:

There are two ForexCT companies (brokers) with almost identical names: Forex Capital Trading Ltd (ForexCT Ltd), an unregulated Vanuatu company; and Forex Capital Trading Pty Ltd (ForexCT Pty Ltd), a regulated Australian company. The Vanuatu company is the parent, and the Australian company is the subsidiary. The ForexCT website is the website of the Vanuatu parent company.

Only Australian residents can be clients of ForexCT Pty Ltd (the regulated Australian company). All others are clients of the Vanuatu parent company.

Apparently, any non-Australian (including Americans) can open an account with ForexCT Ltd (the unregulated Vanuatu broker), and I did just that, a few minutes ago. I opened a live MT4 account, furnishing only my name, email address, password, country, and phone number.

The sign-up page said that I would be receiving an email confirming my log-in info. However, it was about 4:30pm New York time (7:30am Saturday morning in Vanuatu) when I “opened” this account, so I’ll probably have to wait until Monday for that email.

Our listing of ForexCT (Australia) in Group 1 of the Offshore Broker List (indicating that they will accept new U.S. clients) is obviously incorrect.

Clearly, we need to do one of two things: either (1) change our listing in Group 1 to show ForexCT Ltd as an unregulated Vanuatu broker, or (2) remove ForexCT from Group 1 and add them to Group 2 (brokers who will not accept U.S. clients).

Any opinions on this choice?

I haven’t had time to look into these, but I will give it a shot over the weekend.

You did such a good job of finding these 6, how about finding 6 new brokers to replace them? :13:

Hey Clint it looks like I found a broker to add to the Good Guy list. Tallinex FX out of Estonia. The US is one of the listed countries in the drop down on the open live account page. Tallinex - FX Trading Software

[Clint]

Tallinex FX out of Estonia. The US is one of the listed countries in the drop down on the open live account page.

Thanks, petg6. Tallinex looks interesting.

They do welcome U.S. clients. Here’s a statement from their website:

No restrictions for US traders

• enjoy full hedging, no FIFO and leverage up to 1:400

Other facts that I have gathered:

[U]Pros:[/U]

• straight-through processing (STP) to an ECN (Integral)

• micro-accounts (ECN-Micro) with competitive retail (marked-up) spreads, and no commissions; 400:1 leverage;
$100 min. deposit to open; 0.01 lot min. trade size

• mini-accounts (ECN-Pro) with wholesale spreads (no mark-ups) + $6 commission per standard lot (this is equivalent to 0.6 pip, in addition to the spread); 200:1 leverage; $2,000 min. deposit to open; 0.10 lot min. trade size

• segregated customer funds

• no re-quotes

• funding options: bank wire transfer, credit card, debit card, MoneyBookers

• all trading systems, strategies (scalping, etc.) and EA’s allowed

• MT4 platform; GMT server time (may be seen as pro or con, depending on trader preference); demo accounts do not expire (unless dormant for 30 days or longer)

• Estonia is a member of NATO, the EU, and the OECD; their currency is the euro

[U]Cons:[/U]

• Tallinex has only been around since sometime in 2012.

• not regulated; here’s a statement from their website:

Spot Forex is not considered an investment service in Estonia and therefore does not fall within the scope of regulation. However, Tallinex is registered with the Register of Economic Activities in Estonia who enforce strict business practices.
• Estonia was occupied for 51 years by the U.S.S.R., and continues to have a somewhat tense relationship with Russia, which they border; current transnational issues include drug trafficking and money laundering, according to the CIA.

This broker qualifies for inclusion in Group 1 of our List, and I will add them later today (or tomorrow).

Edit: The List has been updated.

Thanks again for the heads-up.

[TheLastBear]

Thanks, petg6. Tallinex looks interesting.

They do welcome U.S. clients. Here’s a statement from their website:

No restrictions for US traders

• enjoy full hedging, no FIFO and leverage up to 1:400

Other facts that I have gathered:

[U]Pros:[/U]

• straight-through processing (STP) to an ECN (Integral)

• micro-accounts (ECN-Micro) with competitive retail (marked-up) spreads, and no commissions; 400:1 leverage;
$100 min. deposit to open; 0.01 lot min. trade size

• mini-accounts (ECN-Pro) with wholesale spreads (no mark-ups) + $6 commission per standard lot (this is equivalent to 0.6 pip, in addition to the spread); 200:1 leverage; $2,000 min. deposit to open; 0.10 lot min. trade size

• segregated customer funds

• no re-quotes

• funding options: bank wire transfer, credit card, debit card, MoneyBookers

• all trading systems, strategies (scalping, etc.) and EA’s allowed

• MT4 platform; GMT server time (may be seen as pro or con, depending on trader preference); demo accounts do not expire (unless dormant for 30 days or longer)

• Estonia is a member of NATO, the EU, and the OECD; their currency is the euro

[U]Cons:[/U]

• Tallinex has only been around since sometime in 2012.

• not regulated; here’s a statement from their website:

Spot Forex is not considered an investment service in Estonia and therefore does not fall within the scope of regulation. However, Tallinex is registered with the Register of Economic Activities in Estonia who enforce strict business practices.
• Estonia was occupied for 51 years by the U.S.S.R., and continues to have a somewhat tense relationship with Russia, which they border; current transnational issues include drug trafficking and money laundering, according to the CIA.

This broker qualifies for inclusion in Group 1 of our List, and I will add them later today (or tomorrow).

Thanks again for the heads-up.

I gave them a look and at first sight they do not look bad. Has anyone ever traded with them. I know they are very young in the market.

[Green_Loren_FX]

If you are looking for an honest broker with great customer service, fast withdrawals and deposits and super follow up with their clients then ForexBrokerInc has been a all of these things for myself.

J Lord

jtlord73 you are very right! ForexBrokerInc is fantastic, customer service is always helpful , good bonus promotions and extremely fast withdrawals

[petg6]

Hey Clint I’ve got another broker to add to the good guy list: Pellucid FX (PellucidFX) based out of Anguilla, British West Indies. Even though they’ve only been in business for a few months, they accept US clients and offer the following services:

RAW ECN spreads from 0.4 pips
$200 minimum deposits
Trade from 0.01 lots on all accounts
Secure SEGREGATED client funds, audited and verified monthly
Up to 400:1 leverage
STP trading via our top tier liquidity providers
Metatrader 4 platform
Trade from anywhere on our Web and Mobile trading platforms
No dealing desk on any trades
Perfect trading environment for robots/EAs
Social trading - Interact with, follow and copy successful traders
Managed Accounts

[solidus]

@Clint

In my opinion, you should absolutely start with a U.S. broker.

The process of evaluating brokers and choosing one is called “due diligence”. Due diligence is tricky enough when you’re dealing with brokers in your own country; it’s even trickier (in many cases) when you are trying to evaluate offshore brokers in various foreign countries.

As an “absolute noob”, you already have enough on your plate at this stage, without adding unnecessary complications to your task. Any of the largest U.S. brokers will serve to get you started in this business. And you may find that you are completely satisfied with your U.S. broker, and see no need to look offshore. Offshore is not for everyone.

If, at some time in the future, you decide to take your forex trading offshore, you can continue to maintain accounts with your U.S. broker(s). It’s not an either/or situation. I started out with FXCM over 7 years ago, and have maintained my FXCM accounts throughout that period, despite all my involvement with offshore brokers.

And one final point: The reasons for going offshore really do not yet apply to you, at this early stage in your forex career. Initially, the CFTC’s restrictions on leverage, FIFO, and hedging should not be deal-breakers for you. Those restrictions might annoy you — as manifestations of the Nanny State in action — but the actual impact of those restrictions on your trading during your first year or two will likely be minimal, and will not justify the effort and/or the risk involved in going offshore.

You have a huge learning-curve in front of you. Take first things first. Learn the basics of the forex market, master the platform and charts of a good U.S. broker with whom you are comfortable, and learn how to trade profitably and consistently. Then, later, if you feel some compelling reason to jump ship and move your trading offshore, you’ll be much better qualified to make that decision.

Greetings all, especially Clint for this thread and the info within. It has really help narrow things down. It’s also made me realize just how bad this current US administration is (wondering if it even surpasses the last one).

Anyways, I’m not new to investing but am to forex. Clint, your post about finding a good US broker makes alot of sense for a noob like myself. The only problem is that the majority of US brokers have all committed severe acts of fraud within the last three years or so, based upon posts from here/regulatory penalties/ reviews from other sites (ie FPA).

I keep on hearing that FXCM is decent but can’t help but to notice their recent slippage cases, and the amount of penalties assess. FXDD, Forex.com, and most of the major US brokers are not far behind either.

I just want to get started but not screwed over in the process. Times ticking folks before the US Gov’t completely shuts forex trading down as a free exchange. I just want to get on the last route leaving the station and off the bus before the last stop arrives.

Any words of wisdom or suggestions would greatly be appreciated.

[compounder]

Rest easy, solidus. More and more new, good offshore forex brokers are popping up to capitalize on the defective, anti-leveraged forex legislation of US lawmakers. “The cat’s out of the bag” now, and nothing can stop forex trading now. And just like with the invention of the atomic bomb, nothing can stop nuclear proliferation (it can be slowed, but not stopped), or forex trading. Don’t underestimate human ingenuity when justifiable, reasonable greed is the motivation.

[Shatners_Last_Stand]

Well, funding some overseas forex brokers just got a bit more complicated.

[B]Liberty Reserve Operators Accused of Money Laundering[/B]

Online Currency Exchange Accused of Laundering $6 Billion

Taking down money launderers is all well and good, but as a result of this action by the US Government, US residents are now being denied access to most digital currency payment services. I understand Webmoney (Liberty Reserve’s heretofore main competitor) and Perfect Money are no longer accepting US residents or its citizens abroad.

[Green_Loren_FX]

Dear petg6,

I recommend my broker

My broker offers:
1:500 leverage
spread as low as 0.3pip
$5 minimum deposit
segregated clients funds
MT4 platform, Sirix webtrader, Mobile trade and Sirix tablet
minimum trading volume 0.01
account manager
fantastic customer service
and more and more

I believe that mine broker is the best for US traders :)!

[bravehoststamps]

Not sure if this one has already been mentioned here, but Estonian-based brokerage Tallinex.com accepts US customers with no restrictions. They also offer a unique managed account service at Tallinex - FX Trading Software

[Clint]

I’ve been away from the forum for a week, and will continue to be away most of next week — so, I’m late in responding to recent posts on this thread. I’ll try to play catch-up.

@petg6

Hey Clint I’ve got another broker to add to the good guy list: Pellucid FX … based out of Anguilla, British West Indies.

Hello, petg6. I’ve taken a look at the Pellucid FX website, and basically confirmed your findings.

Pellucid FX is a very young brokerage firm, founded by a Canadian guy named Damon Hunt, and domiciled in BWI.

They are unregulated, and they claim that this is a good thing! Here’s a copy-and-paste from their site (I have highlighted one sentence in red, for emphasis):

Regulation

Pellucid FX’s world revolves around giving the trader everything possible to help them beat the market. Being regulated takes certain tools and privileges away from the trader, so Pellucid FX is painstakingly unregulated.

We understand the concern this could raise and have decided to do something bold and open our internal doors to you.

At Pellucid FX we lay it all on the table for you to see: We are who we say we are, and we do what we say we are doing, verifiably so.

Are My Funds Segregated From The Businesses Money?

Yes all client funds are segregated from the companies accounts and verified each month by our lawyers

Pellucid FX offers 3 kinds of accounts, based on type of spreads: variable spreads, fixed spreads, and ECN spreads. However, their website does not reveal any of these spreads, with the following exception — they list ECN spreads (only) for 18 of the 57 currency pairs offered. Prospective customers who want to consider either their Variable Account, or their Fixed Account, are left to wonder what mark-ups Pellucid adds to the “raw” ECN spreads quoted.

This broker deserves a spot on our List, and I will add them when I update the List, in a day or two.

(6/1/13 — edit — the List has been updated)

Every trader who is interested in this broker should perform his/her own careful due diligence. This is especially important in the case of a very new broker (only months in existence), which is unregulated, and is domiciled in the Caribbean region. Also, as part of your due diligence, don’t forget to inquire about a complete list of spreads.

@bravehoststamps

Not sure if this one has already been mentioned here, but Estonian-based brokerage Tallinex.com accepts US customers with no restrictions.

Hello, Jacob. Yes, Tallinex was added to our List a couple of weeks ago.

@bravehoststamps

They also offer a unique managed account service at Tallinex - FX Trading Software

Thanks for this info.

[enochbenjamin]

jtlord73 you are very right! ForexBrokerInc is fantastic, customer service is always helpful , good bonus promotions and extremely fast withdrawals

RE: Forex Broker Inc.
Good broker with US customer service number. Made my first withdrawal on Tuesday - received funds Thursday.

[Jason_Rogers]

@solidus

Greetings all, especially Clint for this thread and the info within. It has really help narrow things down. It’s also made me realize just how bad this current US administration is (wondering if it even surpasses the last one).

Anyways, I’m not new to investing but am to forex. Clint, your post about finding a good US broker makes alot of sense for a noob like myself. The only problem is that the majority of US brokers have all committed severe acts of fraud within the last three years or so, based upon posts from here/regulatory penalties/ reviews from other sites (ie FPA).

I keep on hearing that FXCM is decent but can’t help but to notice their recent slippage cases, and the amount of penalties assess. FXDD, Forex.com, and most of the major US brokers are not far behind either.

I just want to get started but not screwed over in the process. Times ticking folks before the US Gov’t completely shuts forex trading down as a free exchange. I just want to get on the last route leaving the station and off the bus before the last stop arrives.

Any words of wisdom or suggestions would greatly be appreciated.

Hi Solidus,

Welcome to the forum

Feel free to post in the Broker Aid Station, if there are any questions I can help you with regarding FXCM.

Jason

[forex_assistant]

Well, as the guy that probably started this whole mess, I have been working the hardest to stay on top of the broker issue. I believe that I have posted on this subject but I have to disagree with Clint on the use of US brokers. Anything that is under the control of the US government is probably a bad idea. What I have been recommending is to open an off shore IBC (use your attorney as the director) and set up your accounts using your International Business Corp. What ever profit you take out are taxable, and IBCs are perfectly legal. FIFO and Hedging restrictions may keep US traders from being able to use the safest trading system on the planet but it is also pushing US off shore.

I have talked with many traders/investors moving off shore completely to get out from under Uncle Sams foot print. I am another, probably next year. The there is even a tax benefit on your US tax returns for living off shore. Missing brokers are not the problem, they are only a symptom of the real problem. We can’t prove it but we all know that the government is in bed with the banks, why else bail out the banks when the people are hurting so badly? We can’t beat them and I can’t stomach joining them, what does that leave?

Anyway just wanted to report that Lucror no longer accepts US clients. I didn’t know if anyone had mentioned it yet.
Good luck all.
Bob

[Shatners_Last_Stand]

This may be true right now but after the new regs kick in requiring any broker accepting US clients to register with the US government regulatory groups, then by making application, you are inciting the commission of a criminal act, Participating in an unlawful act and aiding and contributing to the same. Will the regulatory groups prosecute? Doubtful at first, you’re too small unless they feel that prosecution of a few small fries would send a message to others, then they might, but more likely they will wait until they see how their bully tactics have worked.

Hi Forex Assistant,
I went back and read some of your posts from a couple of years ago. Do you still believe what you wrote above?